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Local Column

Olson: DeKalb should invest only in projects that will work, add value

If government is going to invest in private development, it has to choose projects that will succeed and add value to the community.

Those are really the only criteria that matter.

So a hotel planned for 145 Fisk Ave. is out – and a plan for more apartments and stores in downtown could be in – as DeKalb city officials try to decide how to spend their tax increment financing largesse.  

I was surprised when the council in December gave preliminary approval to a $2.5 million TIF grant for the hotel plan. Maybe the plan to revitalize the long-vacant building was truly visionary, but I didn’t see how it would work. Neither did the neighbors. After he took over and started digging into the finances, Bill Nicklas, DeKalb’s new city manager, didn’t buy it, either.

This isn’t Silicon Valley, and the city of DeKalb isn’t an angel investor. If you want $2.5 million in public funds, your business plan had better be solid. Not in theory, but in terms of real numbers.

Developer Nick Cronauer’s reaction to Nicklas’ skepticism was, ultimately, to file a federal lawsuit against Nicklas and to warn the City Council at a public meeting on Monday that they were making “a big mistake.”

In doing so, he seems to have confirmed exactly the opposite.

Meantime, officials are on to the next big thing, which could be a proposal to demolish the massive building near Fourth and Locust streets and turn it into ... more mixed-use apartment buildings. Pappas Development LLC and principal owner John Pappas are contemplating the plan.

Pappas’ company has already finished the Cornerstone building and is in the midst of another project, Plaza DeKalb. Already, the company has received millions in public incentives for projects.

If this plan will work, give them $3 million more. It’s not as though other experienced developers are lining up to invest in these properties.

I’ve written extensively about the “Mooney building” at Fourth and Locust. How it was built in 1881 as a barbed-wire factory known as the “Red Shop,” how war materiel was manufactured there during WWII and how it became a car dealership after the war.

The building is steeped in history. But for the past 7 years, it has been a vacant hulk that mars the streetscape. It’s a textbook example of a “blighted” property.

No one has come up with a workable use for the building in 15 years. If it takes $3 million for Pappas – or anyone else – to return the property to productive use, let them have it.

Before they write a check, though, the plan should be held to the same standard as the hotel plan was – it has to be workable, and it has to add value.

• Eric Olson is general manager of the Daily Chronicle. Reach him at 815-756-4841 ext. 2257, email eolson@shawmedia.com, or follow him on Twitter@DC_Editor.

Note to readers: This story has been updated to correct an error in how long the property has been vacant.

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